WazirX hack allows $200M worth of crypto to be exchanged for ETH to bypass blockade

Funds stolen in the July 18 hack of Indian cryptocurrency exchange WazirX are being exchanged for Ether (eth).

ai/en/platform/entity/2220″ target=”_blank” rel=””>Data According to on-chain tracker SpotOnChain, the attacker has converted over $200 million of the stolen assets into eth. At the time of publication, the blacklisted wallet contained 59,097 eth.

15,298 eth was stolen directly from WazirX’s multisig wallet, along with 200 different crypto assets including SHIB worth $102 million, MATIC worth $11.25 million, PEPE worth $7.6 million, USDT worth $7.79 million, and GALA worth $3.5 million.

Most of these assets have been exchanged for eth and the wallet currently contains just over $11 million worth of altcoins such as Chromia (CHR), Celer Network (CELR), Frontier (FRONT), and Ooki (OOKI) tokens.

Meanwhile, blockchain analytics firm Lookonchain highlighted that the hacker made a deposit of 7.7 million DENT tokens to a Binance address, adding that the wallet had “not been used before.”

Iakov Levin, co-founder of Rivo, told crypto.news that the hacker likely swapped ERC-20 tokens for Ether due to its high liquidity. He also stressed that “it is not possible to lock eth like stablecoins.”

ERC-20 tokens have a contract feature that allows contract owners to maintain a list of addresses that are prohibited from participating in token transactions. This is typically implemented by a mapping structure in the smart contract, which checks the blacklist before executing transfers, thus preventing any interaction with the blacklisted addresses.

In contrast, eth lacks this feature as it operates on the ethereum core protocol, which does not allow modification of address permissions.

Akhsay Nassa, co-founder of Chimp DEX, also held a similar opinion, explaining that the attacker wants to prevent authorities from freezing the funds.

“With a large and active market, eth allows for fast and fair transactions. Furthermore, its numerous cross-chain bridges and exchanges allow for easy movement between blockchains, further obscuring the trail,” he added.

The attack was the result of a breach in the exchange’s wallet management system. Discrepancies were detected in the data being displayed for Liminal, the exchange’s digital asset custody and wallet infrastructure provider.

“We suspect that the payload was replaced to transfer control of the wallet to an attacker,” the WazirX team said in its subsequent analysis of the incident.

Meanwhile, crypto sleuth ZachXBT speculated that North Korea’s Lazarus Group may have been involved. Blockchain analytics firm Elliptic also came to terms with the matter. similar conclusion.

WazirX has halted withdrawals of both cryptocurrencies and fiat money and promised to recover the funds.